New tax break for Germans returning Nazi-looted art
German citizens who restitute artworks despoiled by the Nazis from Max Stern can now receive a tax receipt recognized by the German government.
Effective as of the beginning of 2017, receipts for the full market value of the art may be issued by the German Friends of the Hebrew University of Jerusalem to individuals who relinquish works claimed by the Max Stern Art Restitution Project, which is managed by Concordia University.
This arrangement, between the Stern estate and German authorities, has been in the making for several years and is believed to unprecedented in the world.
The goal is to pragmatically address the vexing problem of finally seeing justice done for the rightful heirs of Nazi-looted cultural property, said Clarence Epstein, Concordia’s senior director of urban and cultural affairs, who has overseen the not-for-profit Stern project since its launch in 2002.
The tax break was conceived by the project as an incentive for Germans who, after the Nazi period and in good faith, unwittingly acquired art that was plundered from Stern or subject to forced sale.
Epstein calls it “a fair and just solution” that will “soften the blow” of those giving up Stern art, a loss that may be many thousands of dollars. The German Friends, a Berlin-based charity, will accept works on behalf of the Max and Iris Stern Foundation and offer receipts for the donation.
Before World War II, the Jewish Stern owned an art gallery in Düsseldorf and had amassed a valuable collection.
The heirs of his looted art are, according to his wishes, Hebrew University, Concordia and Mcgill University. Stern, who for decades owned the landmark Dominion Gallery on Sherbrooke Street, died in 1987. He and his wife had no children.
Extending tax relief is recognition that today’s possessors – as the project refers to them, rather than owners – typically do not know that the art has a tainted history, said Epstein.
Seven of the 15 paintings the project has recovered were found in Germany, all but two from individuals. The latest are two Dutch Old Master paintings that were handed over in a ceremony at the Canadian embassy in Berlin in December.
It is believed the preponderance of the Stern art is in Germany, with some of it circulating on the art market. However, the project has only located about 10 per cent of the hundreds of works that are still unrecovered.
So far no receipts have been issued or sought, said Epstein, but he said the project will be making a number of claims in Germany this year and the incentive may have an effect on their outcome. The offer is not retroactive. Although discussions between the estate and German government dragged on, Epstein said the delay was not due to opposition but rather to “administrative and bureaucratic” considerations in restructuring the tax code.
No one has apparently objected that this arrangement could compensate people who did not conduct due diligence before acquiring the art. All the known Stern art is listed with the Art Loss Register, an international database, and other resources. It’s unclear whether those who inherited works from people who obtained them knowing they were Nazi-looted could benefit.
Stern lost an estimated 400 paintings during the Nazi era. More than 200 of them were liquidated under duress at the Lempertz auction house in Cologne in 1937. It’s believed that Stern did not receive anything from the sale, where prices were well below worth. Shortly after, he fled to Paris and then London.
The Stern project is unique in the world in its scope and relentless pursuit involving international collaboration with researchers, art trade professionals and, increasingly, law enforcement agencies, such as Interpol, and those in Germany, the United States and Canada.
“The project’s aim is not monetary, but rather moral and educational,” Epstein said – that is, furthering understanding that restitution is just.
Fifteen years on, tracking down and recovering Stern art remains a challenge. Germany’s 30-year statute of limitations on stolen property doesn’t make exceptions for Nazi-spoliated art, meaning such works can be can held or sold legally.
Proving a claim, especially on a work that has changed hands several times, is difficult, as paper trails back to the 1930s or 1940s can’t always be found, Epstein said.
What has improved with time is the attitude of German auction houses. They increasingly recognize their responsibility to verify the histories of the art consigned to them and are more co-operative with the Stern project, Epstein said.
Two paintings were restituted to the Max and Iris Stern Foundation in a ceremony at the Canadian Embassy in Berlin last month.